Austria had maintained close trade relations with various states of Central and Eastern Europe under the Council for Mutual Economic Assistance (Comecon) arrangements. Those arrangements collapsed at the end of the 1980s and, as of the early 1990s, had not yet been renegotiated. Because of the turmoil in several East European states, for example in the former Yugoslavia, precise trade arrangements will likely require some time to be negotiated.

Nonetheless, Austrian firms have proceeded actively to strengthen their position in Eastern Europe. Austrian firms soon were a major part of the thousands of joint venture agreements established with Hungary, the Czech Republic, and Slovakia. Austrian firms have also become involved in many joint ventures in the former Yugoslavia, but their fate remains uncertain as long as the region is unstable. Austrian firms have always been well placed in Slovenia and Croatia, both of which were once part of Austria-Hungary, and Austria resumed economic links with them as soon as they became independent in 1992.

Austrian foreign investment, which has always remained closely in balance with foreign investment in Austria, although both had risen over the years, suddenly doubled to S11.4 billion in 1989 and rose to a new high of S18.3 billion in 1990. Much of the new investment was destined for Eastern Europe.

One of the hopes of the government is that many companies wanting to expand their operations in Eastern Europe will establish offices in Vienna. The city offers office space with modern facilities, often at modest prices. As of the early 1990s, a number of companies had set up operations there for these reasons.

In a broader sense, many of Austria's domestic and international policies will need to be adjusted to take into account developments taking place around Austria. Such concerns have been expressed before, by Austrians and by others, but may be more urgent in the future than in the past. The opening toward Eastern Europe and the creation of the EEA and the Single Market have changed the foundations on which Austria has functioned since the 1950s and will present new competitive challenges for production, marketing, and services.

As of late 1993, however, there were no indications that Austria had changed its patterns of behavior and operations, largely because they have been successful. The pressures that might provoke such a revision have not risen to the level where change is imperative. Moreover, if Austria needs to make changes to adjust to new pressures, many arguments could be made that some form of social partnership or social consensus mechanism may be more necessary than ever.

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As is the case with many small countries, few studies of Austria exist in English, and the economy receives even less attention than other areas. Except for one collection of essays dating back to 1982, The Political Economy of Austria, edited by Sven W. Arndt, nothing comprehensive is available on the economy. Even books in other languages are rare, in part because most German-language books are highly technical85a al. Instead, those who want to read about the Austrian economy must look for economic chapters in general texts about Austria, many of which are unsatisfactory.

However, a number of publications exist that contain relatively good information. The most useful are the annual publications of the Organisation for Economic Co-operation and Development that not only contain statistical information but also essays on various basic aspects of the economy. The quarterly and annual surveys published by the Economist Intelligence Unit, Country Report: Austria and Country Profile: Austria, also offer useful statistical information as well as summary analyses.

A number of German-language periodicals are published in Austria, including some published by major banks and some that are published by the Österreichisches Institut für Wirtschaftsforschung. These periodicals offer some useful up-to- date analyses as well as complete statistics. Thus, although the Austrian economy does not receive the kind of bibliographic attention that larger economies attract, basic information is available and reliable. (For further information and complete citations, see Bibliography.)

Data as of December 1993